The North-east’s subsea industry is facing its toughest year ever - but the North-east has “great potential”, the most senior figure in the UK industry says.

speaking ahead of a major global subsea conference next week, Subsea UK boss Neil Gordon says that, with 70% of North Sea production now subsea based, innovative companies in the region can succeed.

Teesside firms and offshore workers are facing worrying times, after big job loss announcements - most recently 600 North Sea job cuts from BP and one of the world’s major oilfield services companies, Schlumberger.

Neil said: “In an environment where operators need to make the most of their existing assets the innovative capabilities of the UK, and the North-east, are key.

“The North East (of England) is a great place. It has strong manufacturing capabilities with many great companies and they are plugged into the themes that are now emerging as key to the future success of the industry.”

While behavioural change has been toyed with during previous downturns this time it has to be ‘for real’, says Neil.

“There is no getting away from it this time. We have cut the staff and squeezed the supply chain, but we now need to build long-term efficiencies into the system, to learn how to collaborate, standardise, simplify, do things better and build this industry back up together.

“We are in for the long haul. This is going to be a long slump. Opec is no longer controlling the market. Russia is pumping all it can, we have the US shale oil and the slowdown in China.

“There is a glut of oil and there will be for some time to come. We are now living in a low-cost world.”

Mr Gordon will be sharing these views with the global subsea community at next week’s annual Subsea Expo get together in Aberdeen.

He n describes the mood in the industry at the moment as ‘downbeat’ with a great deal of trepidation for what lies ahead in 2016.

“What has happened so far has been bad, thousands of people have lost their jobs - and how do we replace them when the up turns comes, as it inevitably will.

“This year will be about survival. There will be a lot more pain and things will get worse before they get better.”